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Yesterday's news that Ofcom, the new communications regulator, is looking to squeeze BT's wholesale prices for broadband has met a mixed reaction from the industry.

AOL UK welcomed moves that could lead to increased competition in the UK's wholesale ADSL market, claiming it was a "significant step forward for broadband in the UK".

A spokesman for the ISP said: "If the proposal were adopted, it would provide better transparency, regulatory certainty and hopefully increased efficiency in the provision of wholesale broadband services. This would lead to wider choice, product innovation and possibly lower prices and greater availability for consumers."

However, AOL warned those involved not to get bogged down in the consultation process but to work towards a "prompt outcome".

John Pluthero, former boss of Freeserve and now chief exec of Energis, struck a more sceptical tone.